Divorce Malpractice – Failure to Safeguard Assets Theory of Recovery Recognized

In Anderson v. Law Offices of Benedict Schwarz, 2014 Il App (2d) 230308-U, the plaintiff sued her former attorney, alleging malpractice in a divorce case. Plaintiff alleged: “that the defendants failed to take appropriate measures to freeze or maintain accounts that she owned with her husband. Because the assets were not frozen, her husband was able to sell five homes, five land parcels, an office, and an apartment building, most below appraised or market value. She asserted that the defendants knew of her husband’s liquidation and dissipation of marital assets but did not take adequate steps to prevent those losses. As a result of the defendant’s negligence, she alleged that she had to settle the underlying matter prematurely in order to keep her marital home and not be evicted. She further alleged that she lost money, all alimony, all her retirement, all her businesses, all her health insurance, and was left six figures in debt, with a home that needed major repairs.” The trial court dismissed the Complaint on a 735 ILCS 2-615 motion, but the Appellate Court reversed.  The trial court was swayed, in part, by the defense argument that the lawyers withdrew before the case was completed and that subsequent counsel could have remedied the problems. The Appellate Court reasoned as follows:

¶ 12 Here, the trial court erred in dismissing the plaintiff’s complaint. The plaintiff set forth all of the elements of a legal malpractice claim. She alleged that she hired the defendants to represent her in her marriage dissolution proceedings. She alleged that the defendants breached their duty to her by not freezing her husband’s assets so as to prevent him from diminishing the marital estate. She further alleged that due to the defendants’ breach of their duty, she suffered damages due to a diminished marital estate and because she had to accept a marital settlement agreement “prematurely” in order to keep her marital home. Despite the defendants’ insistence to the contrary, the plaintiff’s allegations included enough specificity for them to prepare a defense.

Of more interest to the practitioner in this area is the court’s discussion of why the fact that the lawyers withdrew does not bar the claim. Plaintiff argued that the actions of the defendant law firm so badly damaged her case that she was required to settle it for less than its value. The court cited Webb v. Damisch, 362 Ill. App. 3d 1032, 1042 (2005) and McCarthy v. Pedersen & Houpt, 250 Ill. App. 3d 166, 172 (1993). The court reasoned that there were factual disputes between the parties as to which of the various law firms was to blame for the failure to protect assets and that those factual disputes could not be resolved on a motion to dismiss.

Do not hesitate to call us if you wish to discuss a legal malpractice issue.

Ed Clinton, Jr.

http://www.clintonlaw.net